I can GUARANTEE you that Nike does not make a profit of $50 per shoe. The retail mark-up is well over 2X the wholesale price. That's how retailers can put things on sale for 50% off and still make a profit.

Don't forget all the development, engineering, transportation, marketing, sales, advertising, and overhead costs that need to be included into the cost of a pair of shoes. The cost of materials for a shoe may be $7, but add in labor costs, equipment costs, factory overhead, and profit for the factory that Nike contracts to make the shoes. Add in all of these costs and I'd be surprised if Nike makes more than $15 in profit on a pair of shoes after accounting for returns, seconds, discounting after season, etc.

Besides, it's not like nobody would buy Nike shoes if Agassi didn't wear them. So you have to estimate only the INCREMENTAL sales that would not have occurred without Agassi. Was it an incremental $100 million in profits (not sales)? I doubt it.

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Nike makes a hefty profit on shoe sales. It is their cash cow. When kids buy Jordan's, Kobe's, Ballistics etc.. I can safely say they earn more than $15/shoe. My brother works in the corporate office for a major athletic apparel company that includes shoes. The money the can make off shoe sales is why addidas can give Derrick rose $250 mil. And the cost of manufacturing a pair of nikes, factory+labor is no more than $20 best case scenario. When phil knight + Nike were busted for running sweat shops in Taiwan the cost of each shoes with labor attached was half. Basketball sneakers alone do $2 Bil in sales annually. I'm sure tennis doesn't do as well but even a slight fraction of that is a nice profit. And if u think shoe companies spend more than 5% of their budget on R&D then can I interest you in some moon rock I want to infuse into the next line of tennis racquets?

Nike makes a hefty profit on shoe sales. It is their cash cow. When kids buy Jordan's, Kobe's, Ballistics etc.. I can safely say they earn more than $15/shoe. My brother works in the corporate office for a major athletic apparel company that includes shoes. The money the can make off shoe sales is why addidas can give Derrick rose $250 mil. And the cost of manufacturing a pair of nikes, factory+labor is no more than $20 best case scenario. When phil knight + Nike were busted for running sweat shops in Taiwan the cost of each shoes with labor attached was half. Basketball sneakers alone do $2 Bil in sales annually. I'm sure tennis doesn't do as well but even a slight fraction of that is a nice profit. And if u think shoe companies spend more than 5% of their budget on R&D then can I interest you in some moon rock I want to infuse into the next line of tennis racquets?

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The fact that shoe companies pay athletes contracts like $250 million or $100 million is exactly why they can only make a profit of $15 or less per pair of shoes. Those salaries are included in marketing costs, which are deducted before net profits. The question is, did Nike make more net profits after paying Agassi $100 million or would they have made more net profits from their tennis business if they hadn't paid Agassi $100 million? What was the net incremental profit after paying Agassi?

i dont even think nike thought of agassi as a profit deal but more of as an advertisement deal. he was always on tv and in the magazines wearing nike clothing and shoes - exposure. even if people didnt buy his crazy neon clothes and shoes he got the brand out there

I can GUARANTEE you that Nike does not make a profit of $50 per shoe. The retail mark-up is well over 2X the wholesale price. That's how retailers can put things on sale for 50% off and still make a profit.

Don't forget all the development, engineering, transportation, marketing, sales, advertising, and overhead costs that need to be included into the cost of a pair of shoes. The cost of materials for a shoe may be $7, but add in labor costs, equipment costs, factory overhead, and profit for the factory that Nike contracts to make the shoes. Add in all of these costs and I'd be surprised if Nike makes more than $15 in profit on a pair of shoes after accounting for returns, seconds, discounting after season, etc.

Besides, it's not like nobody would buy Nike shoes if Agassi didn't wear them. So you have to estimate only the INCREMENTAL sales that would not have occurred without Agassi. Was it an incremental $100 million in profits (not sales)? I doubt it.

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Totally INCORRECT. Retail $ is actually NOT 2x wholesale for tennis shoes. Wholesale is approximately 52-54% of retail. (I'm using the price I saw for Vapor 9 shoes.)

I was lucky to have seen the wholesale prices on nike.net, the retailers' ordering platform.

The company that has the US licence to slap a name on Chinese made tennis racquet's and call them Donnay for a fee to UK owned superstore Sports Direct has zero to do with the Belgian Donnay and past glories, players, etc....again...for the 50th time.

i like the new donnays, regardless if they are made in china or belgium. good feeling sticks, the dampened response of a prostaff with a prestige feel, thin beamed. if only they were priced like dunlops

Don't forget all the development, engineering, transportation, marketing, sales, advertising, and overhead costs that need to be included into the cost of a pair of shoes. The cost of materials for a shoe may be $7, but add in labor costs, equipment costs, factory overhead, and profit for the factory that Nike contracts to make the shoes. Add in all of these costs and I'd be surprised if Nike makes more than $15 in profit on a pair of shoes after accounting for returns, seconds, discounting after season, etc.

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There's like $2.50 worth of cheap plastic and foam in that shoe. Local retail price: $129.98
Hearing how Nike only makes $15/ pair of shoes breaks my heart. Pretty soon I will start a charity for them.

For the guy's who really know the pro's racquets. Did Andre ever leave Donnay? I have heard that he was using a Donnay racquet with the proper head paint job.

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There was a time when Agassi first signed with Donnay that he was dissatisfied with the frame they built him. For a time, Agassi was even playing with the Prince Original Graphite with a big "D" stenciled on it. The folks at Donnay were aghast. It seems Agassi never told them he didn't like the frame. The frame was fixed.

Then there was Agassi's foray into the widebody world. He played the 1st round at the French with a new Donnay widebody frame. Things didn't go too well with the frame and there were none of Agassi's old frames around. Agassi wound up winning the match and breaking every one of the new widebody frames after the match on court.

It has to be a little embarrassing for Donnay to have this happen so soon after making a big deal of "46 racquets bought." I see it's been pulled from their blog, http://blog.donnayusa.com/ originally posted Sept. 19.

It has to be a little embarrassing for Donnay to have this happen so soon after making a big deal of "46 racquets bought." I see it's been pulled from their blog, http://blog.donnayusa.com/ originally posted Sept. 19.

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Well, most of us can relate, having just bought a new racquet, I find myself now wondering about the Steam99s...

It has to be a little embarrassing for Donnay to have this happen so soon after making a big deal of "46 racquets bought." I see it's been pulled from their blog, http://blog.donnayusa.com/ originally posted Sept. 19.

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i like their 'spin' article that roddick and clijsters basically retired due to shoulder injuries because they didnt use a donnay racquet

I can GUARANTEE you that Nike does not make a profit of $50 per shoe. The retail mark-up is well over 2X the wholesale price. That's how retailers can put things on sale for 50% off and still make a profit.

Don't forget all the development, engineering, transportation, marketing, sales, advertising, and overhead costs that need to be included into the cost of a pair of shoes. The cost of materials for a shoe may be $7, but add in labor costs, equipment costs, factory overhead, and profit for the factory that Nike contracts to make the shoes. Add in all of these costs and I'd be surprised if Nike makes more than $15 in profit on a pair of shoes after accounting for returns, seconds, discounting after season, etc.

Besides, it's not like nobody would buy Nike shoes if Agassi didn't wear them. So you have to estimate only the INCREMENTAL sales that would not have occurred without Agassi. Was it an incremental $100 million in profits (not sales)? I doubt it.

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Obviously they study all this stuff before offering a contract to somebody. If they pay someone a certain amount of money, it's because he generates it.